Talk of the Day -- Asustek gearing up to revive smartphone business

Riding on its success in PC and tablet sales, Asustek Computer Inc. is investing heavily in reviving its smartphone business, according to local media reports.

Asustek once partnered with Garmin to tap the smartphone market. In early 2009, it unveiled Nuvifone M20, a pad-type phone with Bluetooth, GPRS/GSM connectivity and Windows 5.0 operating system.

But the two firms parted company in late 2010 because of sluggish sales and strong competition from smartphone titans such as Apple Inc., Samsung Corp. and HTC Corp.

At the time, media reports said, a group of Asustek engineers joined the ranks of HTC.

The trend, however, is reversing itself. With its smartphone sales in markets other than China sagging, HTC is adjusting its structure and quite a few of its engineers have left and gone to work for Asustek, the reports said.

Asustek executives declined to comment on the reports, but they confirmed that the company is indeed determined to revive its smartphone business.

The following are excerpts from local media coverage of Asustek's development plans:

Commercial Times:

Asustek chief executive officer Jerry Shen said at an investors' conference Wednesday that smartphones are where the company has allocated the most resources, including recruiting the best engineers and salespeople.

"We also want to make sure we use the newest chips from Qualcomm," Shen said.

He revealed that the company is scheduled to unveil its second- generation PadFone by the end of this year.

"It will feature everything fresh and new," Shen made assurance.

In the future, he said, ICT companies must be able to simultaneously address all three aspects of the compute market -- PCs, tablets and smartphones.

Against this backdrop, Asustek must rejuvenate its smartphone sector to maintain its growth momentum, Shen said, adding that the company will spare no efforts to forge partnerships with major telecom operators in the United States and Europe to achieve a successful comeback to the smartphone market.

Asustek stands a good chance of developing cooperative ties with top-tier telecom carriers by the second quarter of next year, Shen said.

"By that time, we'll launch out third-generation PadFone," he added confidently.

After reporting stronger-than-expected business records for the second quarter of the year a day earlier, Asustek share soared to NT$294.5 Thursday, up 7 percent -- the maximum daily permitted increase.

According to company data, Asustek reported NT$4.82 billion in net income last quarter, down 4 percent quarter-on-quarter from NT$5.01 billion, but up 34 percent from NT$3.6 billion a year ago. (Aug. 30, 2012).

United Evening News:

Competition in the global smartphone market is increasingly intensifying. On the eve of the opening of Germany's 2012 International Funkausstellung (IFA), one of the world's largest trade shows for consumer electronics and home appliances, major market players have unveiled their new models.

Samsung outpaced Nokia in unveiling its first Windows Phone 8 device, the ATIV S as part of its new product line-up under the ATIV brand, on Aug. 29. The Samsung ATIV S is positioned as a smartphone for both work and entertainment.

During the IFA trade fair, Samsung will also launch its Android-based Galaxy Note 2 smartphone model.

Shen said at Wednesday's investors' conference that Asustek's mobile PC market share in North America grew by 3.1 percent to 7.1 percent in the quarter ending in June.

"Zenbook and Nexus 7 have helped a lot to boost our brand recognition in the United States, which in turn helped our sales," Shen explained.

Thanks to strong demand for Nexus 7, a co-branded tablet with Google Inc., Asustek s annual tablet shipments are expected to surge to 5 million units from the original target of 3 million units, Shen added. (Aug. 30, 2012).